Help!

 Im really hoping you guys can help! I'm new to this site. 

So bought a small 2 berth this year (23 years old) not perfect by any means but spent on a new refurb and replacing parts ie leisure batt, new tyres, water system, pump, blinds etc. Had 2 fun trips out in her when we were gifted another caravan which we jumped at as its bigger.
So we sold the van in a few days on Gumtree but stupidly wrote 'no damp' on the advert. On viewing the van the guy spent considerable time alone in it with his wife checking cupboards, underneath seats etc They seemed happy there was no sign nor smell of damp and all electrics, cooker etc were in full working order.  They left and had a discussion and got back to us saying they'd like to buy it.  Four days later they  bought and collected the caravan then went on their merry way.
8 days later they contacted us to say they had found damp and wanted a full refund. We were shocked but agreed to a full refund providing we received the van back in its original condition as we would gift it to extended family.

This is where I need a hand.

They wanted us to arrange to view the caravan with them as it was no longer in its original condition. This was due to them taking up the new flooring and the wall covering off of the right hand wall back to the outside wood and took down the new blinds. After more back and forth messaging, they agreed to fix the van and OH arranged a time to view it. However at the viewing they stated it was irreparable and he was shocked at the state it was in. He took photos and left.

They are insisting we retrieve the van and pay them their monies minus £200 to cover their damage whilst carrying out investigations to locate the source of the damp, otherwise we face potential further action for misrepresention of the van ie saying it had no damp. As a good will gesture and to put an end to this we have offered half their money as a refund which leaves us out of pocket and no van. They have refused our offer.

I'm finding this experience very stressful.

I can't seem to find our rights online but assuming we have a right for the van to be returned to us in its original (or near enough) condition before issuing a full refund? We have received a letter from them citing the Sale of Goods Act '79 and misrepresentation due to finding damp and considering a small claims against us.

Many thanks in advance
Camp03
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